The IMF Goes Green!

Ireland and Austerity

by Kathleen Wallace Peine / April 6th, 2011

Ireland: The latest casualty in the quest for worldwide working class austerity. We know the drill well, through corruption and rabid profit seeking the political and finance world of Ireland managed to bring a thriving country to the brink of ruin. The average Irish had essentially no say in the creation of this debacle. The instigators forwarded the theme that they were the only ones sophisticated enough to maneuver he world of these financial weapons of destruction. The carnivorous financial plays were more likely shrouded in manufactured complexity in an effort disguise the basic alchemy at work.

The failure of these financial sophisticates should have produced a shining moment of clarity; the individuals who pulled the world into this thievery should have been soundly disavowed. Sadly this has not been the outcome; the payment for this behavior continues to be placed on the very souls who did not cause it. The experts who created this financial train wreck are now quite invisible, but the ever burdened working class is all too evident as an austerity target.

The International Monetary Fund, in conjunction with the European Union, are now demanding that Ireland place a property tax on its citizens to facilitate revenue generation for loan payback. It’s telling that a tax on simply having a shelter is being forwarded. This is always a magnificent way to force participation in an economy that one may not believe in. When it is necessary to come up with extra cash simply to have a home, even one you “own”, then it is yet another means to force involvement in a broad, non localized economy. It is conceivable that one could trade for all manner of things should disillusion hit a critical mass, but implementation of taxes like this raise revenue and ensure participation on the ever increasing treadmill. It doesn’t seem to be an accident that these are types of taxes being proposed.

The very fact that an entity like the IMF is now “demanding” taxes of this nature on what was considered an independent nature is beyond galling.

This is not unlike the stories of shipments of food during Ireland’s great famine. Tales abound regarding commodity shipments being pulled and exported from the nation as locals perished for lack of food. Ireland seems to be trapped in a repeating loop of tragedy. The removal of her resources only to be shipped elsewhere. In this case the resource is the cash and labor of the citizens. Each incident in Irish history certainly rhymes with previous exploitation. One hopes that there will be an Irish epiphany that the acceptance of tragedy is not a birthright. Recent elections indicated a wide scale longing for change but the promise of that seems to have faded as discussion now rest on issues such as negotiating down interest rates as opposed to wholesale default.

The overwhelming fact that needs to be considered in all of this is that the IMF has not shown itself to be anything of a benign association.

Confessions of an Economic Hit Man, by John Perkins, is a worthy read that explores the deranged formulaic means that the IMF and World Bank use to further their interests and in effect that of corporate resource raiders the world over. Perkins acted as an Economist for a Boston entity that provided reports and information for groups such as the IMF. He clearly describes the tactics commonly used.

The banks smash into town, generally in countries that have a lusted for resource. They provide loans to enhance the infrastructure, mainly projects that facilitate resource extraction. Initial promises that locals would see improved lives are discarded handily. What they do receive, is mainly a disruption in their sustainable practices. Native populations are often made homeless in the land of their ancestors with little recourse other than to participate in the new wage economy that displaced them in the first place. At this point it is possible to “blame” the confused and seemingly dysfunctional populace for what is framed as problems of their own making.

Often the infrastructure building is done in a quite tainted manner, projects costing much more through the use of corrupt firms with connections to malleable politicians. This greases the wheels of the process, but predictably burns through great sums of money.

These nations generally have little benefit monetarily from opening up their resources, at least in a general sense, so funds are generally not there when payments are demanded. This is when the IMF or World Bank demands austerity implementation. This is often in the form of required sale of public utilities, enhancing the worldwide trend towards privatization and increased cost for basic necessities.

All this is shouldered by those who do not benefit from the introduction of this corporate model. The local population begins to shoulder a debt load that was not of their making and they pay for processes that lead to the pollution and disruption of their ways of life. To do this to a people is unconscionable, to make them pay for it is demonic. It’s almost like paying for your own rape kit.

Overall, Perkins does a marvelous job illustrating the very well worn path used to extract resources from nations. He veers into a bit of “Are You There God? It’s Me Margaret The Economic Hit Man” in regard to sexuality and relationship issues, but this self indulgence is more than forgiven due to the insider processes that he explains.

These very processes should be kept in mind as we see these entities making forays into debt-ridden European nations. The Irish set-up was a little different in that funds were provided in the form of a “bailout”, not an initial loan, but this makes sense in context….Ireland doesn’t have oil (or anything else that sets the mouths of industry to water). They do have a pool of working individuals who can be used as the test case to see how insurmountable debt burden can be channeled in other parts of the world. If this works well for the IMF and their corporate cousins then truly no area of the world will be off limits for the implementation of debt based servitude. This is a debt that will be present from the moment of birth.

It’s hard to say what will happen should the debt burden become too overwhelming. One well known case in history is, of course, the response in post World War I Germany to extreme reparation payments hashed out at the Treaty of Versailles. A very frightening reason brought about the cessation of these payments, that of the takeover by Hitler’s party.

We have two courses likely, that of continued suffering and austerity or an eventual turn towards frightening rulers who will promise to deliver austerity mitigation more tangible than interest rate tweaking. Of course both paths are terrifying and bear watching as other countries face identical crises.

This is all happening with a backdrop of resource depletion and the end of easy growth, despite what cheerleading pundits proclaim, so there is a wild card in play.

The Irish people did not bring about this situation any more than the indigenous peoples who have the bad fortune to live in areas that contain a resource need by corporate interests. It’s a relinquishment of basic dignities, the right to occupy your home or your land without paying for debts that you did not create. Until the argument is framed in this manner, the IMF and corporate interests will continue to demand austerity from everyone except the culpable.